If You Don't Know Exactly What is Bought
How do You Control Company Spending?
Track All Company Orders & Receipts
In recent months, we have heard about employees at car dealerships, public schools, and church parishes who have used huge amounts their organization's money to fund their gambling addictions, drug habits, or their otherwise inordinately extensive lifestyles. This is not to suggest that a few rouge employees are representative of most workers; and, in fact, employee theft typically DOES NOT begin to come close to the largest loss of company funds in most organizations.
Most money is lost through the inefficiency in the purchasing process. Bob orders something that cost 25% more than the price it could quite easily have been found. Or, John notices that supplies are low, so he places a 6-month supply order on Friday, before going on vacation. Beverly comes in on Monday and, what does she do? She orders 12 months worth of supplies (because, of course, she knows nothing about John's order). Now some of the company's operating capital is tied up in some inventory that might not be touched for a year or more.
There is rarely a good excuse for paying far too much for inventory; and, over-ordering is a considerable problem when purchasing "perishable" inventory (e.g. food, medicine, chemical compounds, baseball game tickets) is involved.
OrderGen Purchase Order Builder Module
Controlling Your Company Expenditures
One way to control any form of unauthorized or erroneous purchasing is to implement a formal purchase order system that will track all employee purchases, and require all purchases to be approved by a centralized authority (purchasing director, department manager, or even CEO).
The person primarily responsible for the company's accounts should set up the purchase order system, and this can be done using a variety of tools. The simplest way to start is to go to the nearest office supply store and buy a physical "PO" book that contains sheets of purchase orders.
Of course, in 2012, we strongly advocate the use of our electronic purchase order software solution, which centralizes the management of approved vendors, required vendor products, complete transaction histories, order shipping & receipt tracking, employee purchasing behavior, and authorized purchase approvals. All employees that can purchase materials must use a system-generated PO number, and all vendors must have a valid PO number and a PO signed by an authorized employee if they expect to get paid.
The Value of Purchase Order Systems
In the mid 1990s, Applied Analytic Systems learned the value of purchase orders first-hand. Not because we needed to track our many purchases (we didn't buy too many things), but because of the way our purchase orders were accepted by major corporations. Sending a professional-looking PO allowed us to get NET 30 or NET 45 terms, even though none of these companies knew who we were. "What small or home-based company would presume to send US a purchase order," they must have figured.
Obviously, this additional cash flow was very important to a small organization. We subsequently packaged our developed in-house purchase order software and made it available to other micro and small businesses, selling it for a reasonable price on AOL, CompuServe, and the Internet.
Since that time we have upgraded OrderGen several times. It costs more now, but is still quite reasonable. It is both a single-user and a local area network program which has been purchased and used by organizations such as
♦ local schools
♦ public school districts
♦ fire and rescue houses
♦ manufacturing companies
♦ publishing and printing companies
♦ recycling and environmental firms
♦ non-profit organizations
♦ many other types of companies
Some of these organizations have OrderGen installed on dozens of workstations.
Setup Your Own Purchasing System
Request the FREE 15-day trial version from Applied Analytic Systems. If 15 days is not enough, a simple email message or support ticket will extend your trial period for enough time for you to be satisfied that you need (or do not need) this software solution.
Don't have a local area network at your company? This Windows (XP, Vista, 7, 8) based program works well on a single computer, laptop, or netbook for one-man and one-woman operations and companies where only one person has purchasing responsibility.
▶ ▶ Request a TRIAL Download from our employee, Delia.